Existing energy grids must be modernized in order to adapt to a changing energy world as well as to the gradual emergence of decentralized production sources. More and more smart grids are being built in Europe and worldwide and seem to be an adequate, effective solution to this challenge. Today South Korea ambitiously pioneers one of the most advanced smart grid projects.

Energy dependency and “green growth”

South Korea is the tenth largest primary energy user worldwide and has 97% of its energy needs covered by imports. In an effort to reduce this strong dependency on foreign energy sources, former President Lee Myung Bak decided to support a “low-carbon green growth” economic strategy for South Korea as soon as he came into office.

This “green growth” strategy is based on a three-pronged approach: reducing dependency on oil, supporting energy savings and cutting greenhouse gas emissions. However, South Korea has a broader goal: taking advantage of an increasingly digitized energy world by implementing a nationwide smart grid network by 2030. To that end, in 2009 the government launched its first full-size smart grid project; the largest of its kind worldwide, it features a record number of cutting-edge technologies.

Jeju Island, a full-scale test bed for smart grid technologies

Consumers were placed at the core of the South Korean smart grid project, with an emphasis on empowering grid users by informing them on how much energy they use at any given time, while encouraging them to adjust their consumption patterns to the amount of energy available.

2,000 households on Jeju Island (located south of the Korean peninsula) were chosen to test the project. Each home was fitted with a smart metre sending real-time information on its energy use to the grid operator, which in turn implemented a real-time pricing scheme in order to encourage users to adjust their consumption patterns.

In more practical terms, 84 new technologies were tested as part of the experiment, among which home appliance monitoring systems such as “smart dishwashers” or “smart refrigerators”, which aim at performing the most energy-intensive tasks during off-peak hours, thus shedding load on the grid at peak times. Besides automated monitoring and control, systems feature a phone app which enables users to remotely operate their “smart appliances” when they are not at home.

Mixed results, too small market

Although the testing phase ended in May 2013, official results have not been made public yet. However, unofficial estimates unveiled by Jerry Yang, team leader at the project-steering Korea Smart Grid Institute, suggest that results fall short of target. “Unofficial preliminary assessments show energy savings of just above 10%”, according to Yang, as some of the households who took part in the project are not yet ready to use these technologies.

Besides, the private corporations which helped fund 115 million euros of the 170 million-euro project are now reluctant to invest in a nationwide smart grid scheme, in particular because of poor prospects for return on investment. Moreover, government control of the market and underpricing of electricity undermine the incentive for users to invest in consumption monitoring technologies.

If it is to meet its ambitious goals, it is therefore up to the government to foster the conditions needed for the involvement of various stakeholders.